LEADERSHIP FORUM   FEBRUARY 16, 2012 ROBERT H. HACKER
“Altruism has a credibility problem in an  industry that thrives on intense commercial  competition”                   Iva...
“What kind of a society isnt structured on greed? The problem of social organization is how to set up an arrangement under...
TOPICS1. SOCIAL VENTURE CHECKLIST2. VALUE CREATION-VALUE CAPTURE3. FINANCIAL MODELING
SOCIAL VENTURE CHECKLISTNON-PROFIT or FOR-PROFIT?
COMPETITIVE ADVANTAGEBENEFITS OF NON-PROFIT?
BENEFITS OF NON-PROFIT• ACCESS TO CAPITAL• LOWER COSTS THROUGH VOLUNTEER  COMMUNITIES• PARTNERING-NGOS, GOV’T, MULTI-LATER...
FOR-PROFIT?SOCIAL ENTREPRENEURSHIP OR     ENTREPRENEURSHIP?
SOCIAL?• NORMATIVE• ECONOMIC
ECONOMICSMAXIMIZE VALUE CREATION or MAXIMIZE VALUE CAPTURE
VALUE CREATION-VALUE CAPTURE
VALUE CREATION-VALUE CAPTURE
VALUE CREATION-VALUE CAPTURE
MODELING• ASSUMPTIONS=RISKS• SOCIAL AND ECONOMIC RISK
FINANCIAL MODELING NON-PROFIT1. DONOR ACQUISITION2. ADMIN COSTS=FINANCIAL CONSIDERATION3. SOCIAL SERVICES=IMPLICIT COST   ...
DONOR ACQUISITION•   TARGET DONOR LIST•   $/DONOR•   ACQUISITION COST/DONOR or•   ACQUISITION COST/$ DONATED•   DETAIL ACQ...
ADMIN COSTS• NON-DONOR AND NON-SOCIAL SERVICES  COSTS• OVERHEAD  – EXECUTIVES, SALARIES & BENEFITS  – RENT  – T&E EXECUTIV...
SOCIAL SERVICES• DOG RESCUE SHELTER  – DOGS RESCUED PER WEEK, PER MONTH  – NEW DOG HOMES and TEMPORARY DOG HOMES  – CASH C...
DOG RESCUE KPIs• WEEKLY, MONTHLY YTD  – DONOR $  – DONOR ACQ COST/$ DONATED (MONTHLY, YTD)  – DOGS RESCUED  – DOG HOMES  –...
Robert H. Hacker  rhhfla@gmail.com  305-742-8222  Skype: rhhflaIf I said anything you disagree with, think wasconfusing, s...
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Social Venture Checklist

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This presentation was given at the Miami Philanthropy Forum FEB 2012. It helps social venture founders decide whether to choose non-profit, social entrepreneurship or entrepreneurship approaches. It is based on a class I taught at MIT Sloan School of Management JAN 2012.

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Social Venture Checklist

  1. 1. LEADERSHIP FORUM FEBRUARY 16, 2012 ROBERT H. HACKER
  2. 2. “Altruism has a credibility problem in an industry that thrives on intense commercial competition” Ivan Krstic TR35 Laureate“An ever growing number intend to fund their social ventures through commercially generated revenue rather than charitable donations….”Battilana and Lee HBS
  3. 3. “What kind of a society isnt structured on greed? The problem of social organization is how to set up an arrangement under which greed will do the least harm.” —Milton Friedman, The Macmillan Book of Business and Economic Quotations
  4. 4. TOPICS1. SOCIAL VENTURE CHECKLIST2. VALUE CREATION-VALUE CAPTURE3. FINANCIAL MODELING
  5. 5. SOCIAL VENTURE CHECKLISTNON-PROFIT or FOR-PROFIT?
  6. 6. COMPETITIVE ADVANTAGEBENEFITS OF NON-PROFIT?
  7. 7. BENEFITS OF NON-PROFIT• ACCESS TO CAPITAL• LOWER COSTS THROUGH VOLUNTEER COMMUNITIES• PARTNERING-NGOS, GOV’T, MULTI-LATERALS, UNIVERSITIES• BRANDING
  8. 8. FOR-PROFIT?SOCIAL ENTREPRENEURSHIP OR ENTREPRENEURSHIP?
  9. 9. SOCIAL?• NORMATIVE• ECONOMIC
  10. 10. ECONOMICSMAXIMIZE VALUE CREATION or MAXIMIZE VALUE CAPTURE
  11. 11. VALUE CREATION-VALUE CAPTURE
  12. 12. VALUE CREATION-VALUE CAPTURE
  13. 13. VALUE CREATION-VALUE CAPTURE
  14. 14. MODELING• ASSUMPTIONS=RISKS• SOCIAL AND ECONOMIC RISK
  15. 15. FINANCIAL MODELING NON-PROFIT1. DONOR ACQUISITION2. ADMIN COSTS=FINANCIAL CONSIDERATION3. SOCIAL SERVICES=IMPLICIT COST DONOR VALUE INTRINSIC COST FINANCIAL CONSIDERATION NON-PROFIT
  16. 16. DONOR ACQUISITION• TARGET DONOR LIST• $/DONOR• ACQUISITION COST/DONOR or• ACQUISITION COST/$ DONATED• DETAIL ACQUISITION COSTS BASED ON BUDGET OF ACQUISITION COST
  17. 17. ADMIN COSTS• NON-DONOR AND NON-SOCIAL SERVICES COSTS• OVERHEAD – EXECUTIVES, SALARIES & BENEFITS – RENT – T&E EXECUTIVE – PROFESSIONAL FEES – IT, PHONE ETC.
  18. 18. SOCIAL SERVICES• DOG RESCUE SHELTER – DOGS RESCUED PER WEEK, PER MONTH – NEW DOG HOMES and TEMPORARY DOG HOMES – CASH COSTS PER DOG – NON-CASH COSTS PER DOG (VOLUNTEERS/DONATIONS) • STAFF COSTS/HR or PER DOG • FOOD • MEDICAL (VETS, DRUGS, ETC.)
  19. 19. DOG RESCUE KPIs• WEEKLY, MONTHLY YTD – DONOR $ – DONOR ACQ COST/$ DONATED (MONTHLY, YTD) – DOGS RESCUED – DOG HOMES – CASH OPERATING COSTS/DOG (MONTHLY, YTD)
  20. 20. Robert H. Hacker rhhfla@gmail.com 305-742-8222 Skype: rhhflaIf I said anything you disagree with, think wasconfusing, stupid, or just plain wrong, pleasetell me. I won’t take offense – don’t sugar coatit – just tell me. Brad Feld

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